Program funding system

The Himalayan Times

29 November 2012

The existing funding system in Nepal in relation to the development projects requires to be revisited in terms of its effectiveness and traditional standard. This system lacks accountability and transparency. As a result, a big portion of funds that are disbursed for the development projects are misappropriated thus hampering the quality achievement of such projects. Also, the targeted beneficiaries of the project are deprived from the intended objectives. It was great opportunity for me and should also be for other readers to read Krishna B. Joshi’s article “Performance-based funding” (THT, 27 Nov, Page 9) that clearly depicts the picture of existing funding system of development projects in Nepal.

Unless the program budgeting system (PBS) is properly practiced and implemented for community based development projects, there remains to be less chances of its real impact at the grass root level. For program budgeting, every detail of each program activity is to be properly identified and enlisted against the required amount of budget and should be reflected accordingly in the annual plan. This system will demand the designation and implementation of performance-based monitoring (PBM) system to ensure the achievements of both quantitative and qualitative indicators. Performance based monitoring system is the most preferred management tool in order to assess the on-going implementing status of each planned activities. If the PBM system is properly designed and put in place, the performance based funding (PBF) system become much easier to follow and implement and vice verse.

Both the PBF and PBM systems should complement each other at the program designation and implementation level. Both the systems require and demand extensive participation of all the concerned development partners, be it at the VDC level, District level and at the Centre level. These systems ensure ownerships and accountability of the responsible planners, implementers and beneficiaries towards such development projects. However, lack of proper trained human resources in these systems could remain to be the bottleneck in properly implementing both PBF and PBM systems. If these systems are properly followed and implemented in the government and donor funded development projects, maximum benefits to the targeted population could be delivered ensuring ownership and accountability of all the concerned stakeholders towards such projects.

Rai Biren Bangdel

Maharajgunj, Kathmandu

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